FOR IMMEDIATE RELEASE

ALBUQUERQUE—While New Mexico’s Hispanics have a lower unemployment rate than Hispanics nationally, their rate is still more than double the unemployment rate for New Mexico’s non-Hispanic whites. This means that, well into a national recovery, nearly one in 12 Hispanic workers continues to be unemployed. Those are the findings of a report released today by the Economic Policy Institute in Washington, DC.

“High unemployment rates for New Mexico’s Hispanics will have long-term consequences for the state’s children,” said Veronica C. García, Ed.D., Executive Director of New Mexico Voices for Children. “Almost half of all New Mexico children are Hispanic, and when their parents are struggling financially, the children suffer as well.”

Although the report, “Ongoing Joblessness in New Mexico,” notes that non-Hispanic whites have also been negatively impacted by the recession, the economic damage to the state’s Hispanics has been deeper and more prolonged. With New Mexico’s unemployment rate expected to rise by the end of this year, according to the report, the outlook is not good.

“This mirrors many of the conclusions in ‘The State of Working New Mexico 2013’ report that we just released,” said Gerry Bradley, Senior Researcher and Policy Analyst for NM Voices. “The wage gap between Hispanics and non-Hispanic whites in New Mexico was beginning to close prior to the start of the recession. Now, the median hourly wage for whites is above $18, but it’s below $14 for Hispanics—so even those who are working are earning quite a bit less than their non-Hispanic white counterparts,” he added.

“Children simply cannot perform well in school when they don’t have financial stability at home,” said Dr. García. “The state needs a more targeted economic development plan than its current scattershot approach of unproven tax cuts for corporations, and it needs to ensure that support systems for families—such as unemployment insurance benefits and child care assistance—are adequate and functioning as they should,” she added.

You can download the report here: http://www.epi.org/publication/ongoing-joblessness-mexico-unemployment/

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New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project. 625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

 Download this press release (pdf)

FOR IMMEDIATE RELEASE

ALBUQUERQUE—New Mexico has lost 42,700 jobs since the Great Recession began, but the state’s jobs deficit is more than double that number. That’s because the state should have added 58,300 jobs since the recession began just to keep pace with population growth. Taken together, those two numbers show that the state is short 101,000 jobs—more than the entire working populations of Las Cruces, Belen, Deming, Grants, Roswell, Española, and Farmington combined. The jobs deficit is one of the focus areas of the report “The State of Working New Mexico 2013,” released today by New Mexico Voices for Children.

By most indicators of worker well-being—employment, unemployment, workforce participation rates, and the like—New Mexico has yet to recover from the losses incurred since December 2007, when the recession began. While wages are higher than they were in 2000, median household income is still lower than it was before the recession began, and New Mexico has the second lowest median household income in the Mountain West region.

“When workers experience unemployment, their children suffer, and that suffering will have life-long consequences,” said Veronica C. García, Ed.D., Executive Director of NM Voices. “This report shows that the state’s economic development strategies need to be better targeted and any tax incentives must be tied to performance and stringent accountability. State leaders also need to be strengthening the safety net for vulnerable children,” she added.

The report points to the construction sector as the biggest loser in the recession—shedding almost one-third of its jobs. That’s higher than the national average of 23 percent. While construction is growing on the national level, New Mexico is still losing jobs on an over-the-year basis.

“New Mexico is simply not creating jobs at the pace it should be and that is cause for concern,” said Gerry Bradley, report author, and Senior Researcher and Policy Analyst for the child advocacy organization. “Our decades-long experiment with tax cuts as a way to create jobs has been a bust. Not only do we not have the new jobs that were promised, the tax cuts have led to less revenue for important services like education, health care, and public safety, which are vital to real economic development. That revenue shortfall has also contributed to our jobs deficit in both public- and private-sector industries,” he added.

“The report makes several policy recommendations to spur job creation and assist the unemployed and their families,” said Dr. García. Among the recommendations are: improving workforce educational levels by investing in early care and education programs that serve children from birth to age five; increasing the minimum wage statewide and indexing it so it keeps pace with inflation; and fully implementing the Affordable Care Act, which includes enrolling all eligible low-income adults in Medicaid.

The full report is available online at: http://www.nmvoices.org/wp-content/uploads/2013/05/State-of-Working-NM-2013.pdf

The executive summary is available online at: http://www.nmvoices.org/wp-content/uploads/2013/05/SWNM-2013-exec-sum.pdf

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New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.

625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

 Download this press release here (pdf)

April 4, 2013

FOR IMMEDIATE RELEASE

ALBUQUERQUE—The omnibus tax bill signed into law today will cost the state of New Mexico at least $100 million dollars by fiscal year 2017 and is not likely to create any jobs. That’s the conclusion of a report by New Mexico Voices for Children on HB-641, the bill that was haphazardly passed in the final minutes of the 2013 legislative session and signed into law today.

“HB-641 is bad for New Mexico,” said Veronica C García, Ed.D., Executive Director of New Mexico Voices for Children. “Giving tax breaks to corporations with no performance accountability attached to them will not serve the interests of New Mexico’s children and working families. These tax-cuts-for-jobs schemes are known to be ineffective at creating jobs and growing an economy that works for everyone.”

The most expensive provisions of HB-641 do not guarantee that companies will set up shop in New Mexico, and they give companies that are already here a tax break without requiring that they add a single job.

“What this bill does guarantee is that the state will have tens of millions of dollars less for education, public safety, and health care,” said Gerry Bradley, Senior Researcher and Policy Analyst for the child advocacy organization and author of the report. “Another provision in the bill will cost local governments $26 million by fiscal year 2017. Cities and counties will be either be forced to pass the cost along to working families, or cut services like fire and police protection,” he added.

“The signing of this bill—coupled with the Good Friday veto of a bill to raise the minimum wage—shows that out-of-state corporations are a higher priority with this administration than New Mexico’s own working families and their children,” said Dr. García. “New Mexico’s lowest-paid working families had their long-needed raise vetoed, while profitable corporations got big tax cuts. New Mexico’s lowest-income workers already pay a much higher percentage of their income in state and local taxes than those at the top, and this bill will make that inequity even worse.”

The report, “HB-641: Bad Bill, Flawed Process, Empty Promises,” is available online here: http://www.nmvoices.org/wp-content/uploads/2013/04/HB-641-policy-brief.pdf.

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 New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.

625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

 Download this press release here (pdf)

March 21, 2013

FOR IMMEDIATE RELEASE

ALBUQUERQUE—Lawmakers cut the state’s top personal income tax rate in half in 2003 with the expectation that the big tax cut would draw companies to relocate their corporate headquarters here. That didn’t happen. Nor did the other five states that cut their personal income taxes in the last decade see any job growth as a result.

That’s the conclusion of a report released today by the Center on Budget and Policy Priorities. Of the six states that enacted tax cuts in the 2000s, three experienced slower-than-average economic growth and three experienced faster-than-average growth. The three states with faster growth—New Mexico included—are oil and gas producers and their economic growth can be traced to a rapid rise in oil and gas prices in the mid-2000s.

The report also looks at states that cut personal income taxes in the 1990s. Those states experienced slower economic growth and fewer jobs created than states that did not cut taxes. The report cautions against embracing income tax cuts as a panacea for economic ills.

“This report further confirms what we’ve been seeing for the past 40 years—that trickle-down economics is a complete and utter failure,” said Bill Jordan, Senior Policy Advisor for New Mexico Voices for Children. “And yet, some lawmakers are still trying to push more tax breaks as a magical solution to our every problem.”

Jordan points out that the recently passed omnibus tax bill is another example of wishful thinking about tax cuts and job growth. “We have no guarantee that cutting corporate taxes will bring jobs, but we do know that these tax cuts will lead to underfunding our public services like education, a tax hike for working New Mexicans, or both,” he added.

The CBPP report is available at: http://www.cbpp.org/cms/index.cfm?fa=view&id=3936

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New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.

625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

 Download this press release here (pdf)

March 19, 2013

FOR IMMEDIATE RELEASE

ALBUQUERQUE—No state has made deeper cuts than New Mexico to its investment in public universities and colleges.

New Mexico cut funding for higher education by $4,775 per student when adjusted for inflation—the largest spending drop in the nation—according to a new report from the Center on Budget and Policy Priorities. That’s a cut of 37 percent compared to the national average of 28 percent.

Cuts in spending have led to a 22 percent average increase in tuition at a public, four-year college in New Mexico since the start of the recession. Nationally, the average tuition increase was 27 percent. Driving up tuition will only make it harder for the state to attract businesses that rely on a well-educated workforce. 

“Business leaders have said over and over again that their companies need a well-educated workforce,” said Veronica C. García, Ed.D., executive director of New Mexico Voices for Children.  “Yet, New Mexico has chosen to cut investment in this area, and the resulting tuition increases have jeopardized the solvency of our Lottery Scholarship fund. Without the Lottery Scholarship too many young people in our state cannot afford to go to college. This is not the way to create a thriving economy,” she added.

When the recession hit in 2008 and tax revenue dropped, most states—including New Mexico—relied heavily on spending cuts rather than a more balanced mix of spending cuts and revenue increases. As a result, many states slashed funding for public colleges and universities. The price of attending a public college or university has grown significantly faster than the growth in median income in the U.S. over the last 20 years.

“More jobs in the future will require college-educated workers,” said Phil Oliff, policy analyst at the Center on Budget and Policy Priorities and author of the report released today. “For the sake of its economy and future workforce, New Mexico should start reinvesting in its colleges and universities now.”

The report can be found at: http://www.cbpp.org/cms/index.cfm?fa=view&id=3927.

The center is hosting a media conference call today at 11am MDT. More information can be found at: http://www.cbpp.org/press/.

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 New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.

625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

 Download this press release here (pdf)

February 14, 2013      

FOR IMMEDIATE RELEASE

ALBUQUERQUE—An increase in the statewide minimum wage—from $7.50 to $8.50 an hour—would put $105 million in new wages into the hands of low-wage workers, who would spend the vast majority of it here in the state. That new spending would increase the state’s gross domestic product by $67 million and create 590 new jobs.

That’s the conclusion of a report by New Mexico Voices for Children that was released today at a minimum wage rally in Santa Fe. The report also advocates for indexing the state minimum wage so that it automatically increases with inflation.

“Raising and indexing the minimum wage would do a couple of things. First, it would help alleviate our high rate of poverty. Second, it would give the state a much-needed economic boost,” said Gerry Bradley, research director for NM Voices and report author. “Since 70 percent of our economy is based on consumer spending, one of the fastest ways to invigorate it is to put more money into the hands of the people most likely to spend it—those who are earning the lowest wages,” he added.

Bradley added that indexing the wage is an important step because it ensures that the wage doesn’t lose its purchasing power over time. “Just since New Mexico raised the minimum wage last—in 2009—it’s lost 10 percent of its value. That’s a loss of more than $1,000 a year for a full-time worker earning the minimum wage of $7.50 an hour. That’s $1,000 less to spend on groceries, diapers, rent, utilities, and other necessities,” he said. “And it will continue to lose value until we raise it again if it’s not indexed,” he added.

The full report is available online here: http://www.nmvoices.org/wp-content/uploads/2013/02/state-min-wage-2013.pdf

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 New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.

625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

 Download this press release here (pdf)

Given New Mexico’s lousy job-creation record, we can assume that the drops in enrollment are not because low-income parents suddenly got jobs and now have private health insurance coverage. Clearly something else is at work.

A large part of the enrollment drop is that the state has stopped funding for all outreach and enrollment activities for children. Many parents simply do not know that their children are eligible for no-cost or low-cost health insurance and some need help navigating the system. The Human Services Department (HSD) has also refused to adopt ‘express lane’ policies to simplify enrollment for low-income families that also qualify for other assistance programs. They even require parents to produce proof of citizenship on their child’s first birthday so the child’s enrollment in New MexiKids can continue—even though the child is obviously a citizen because they were initially enrolled by the state when they were born in a New Mexico hospital the year before! None of this is surprising, given that HSD initially sought to redesign the state’s Medicaid program in order to cut costs.
Failing to cover kids under Medicaid because of cost is penny wise and pound foolish. Children are cheap to insure (less than $1,000 a year for the state) but the payoff in terms of better health and education outcomes is high. Besides immunizations, most children need well-child checkups and the occasional doctor’s visit for the cold or flu. It’s when those well-child checkups catch a developmental delay, which can then be treated before it sets a child’s normal development back, that the program really pays off—for the state as well as the child.

Fortunately, New Mexico is one of the states wisely taking advantage of the opportunity to expand Medicaid to low-income adults under the Affordable Care Act (ObamaCare). Because low-income parents will be expected to apply, their children who are qualified but not already enrolled in New MexiKids will also be signed up. But early enrollment isn’t set to begin until October and coverage doesn’t begin until January 2014.
The Affordable Care Act provides a unique opportunity to improve our children’s health. Better health means better outcomes in school and in life. Let’s do what’s right by our kids and make sure that the implementation of ObamaCare and the Medicaid expansion for adults is well-planned and executed so all of our eligible children are enrolled in New MexiKids.

Unfortunately, working families forego millions of dollars in unclaimed tax credits when they fail to file. This isn’t just bad for low-income working families who really need the assistance; it also means a lost opportunity to positively impact the economy.

The money from tax cuts and credits that go to low-income families are very likely to be spent—which is good for the economy.  Consumer demand creates jobs. That’s why some low-income tax credits were raised as part of the federal stimulus bill of 2009. Tax cuts for middle- or high-income families can also create jobs—if the money is spent. But families with higher earnings are more likely than low-income families to set the money aside in savings. Because people often spend their tax refunds where they live, these credits help boost the local economy. This is particularly good for New Mexico’s rural areas.

One of the best-known low-income refundable credits is the Earned Income Tax Credit (EITC). This federal program provides more than 27 million hard-working American families a refundable credit. It is considered one of the most effective anti-poverty initiatives, and it has always enjoyed bipartisan support. Eligible families may receive a refundable credit up to $5,891 for the 2012 tax year.

New Mexico has a state-level EITC, called the Working Families Tax Credit (WFTC). The state credit is worth 10 percent of the federal credit, is also refundable, and is available to most filers who qualify for the EITC. In 2011 alone, the WFTC returned almost $49 million to New Mexico’s low-income working families.

 Earned Income Tax Credit

In order to qualify for the federal EITC for tax year 2012, your adjusted gross income (AGI) must each be less than:

• $45,060 ($50,270 married filing jointly) with three or more qualifying children: $5,891
• $41,952 ($47,162 married filing jointly) with two qualifying children: $5,236
• $36,920 ($42,130 married filing jointly) with one qualifying child: $3,169
• $13,980 ($19,190 married filing jointly) with no qualifying children: $475

In additional to the WFTC, New Mexico has several tax provisions that help working families, including:

Low-Income Comprehensive Tax Rebate

• Filers whose AGI is $22,000 or less may claim this credit.

Low- and Middle-Income Tax Deduction

This personal income tax exemption for low- and middle-income taxpayers is available if your AGI is less than:

• $36,667 for single persons
• $55,000 for married persons filing jointly, surviving spouses, and heads of household
• $27,500 for married persons filing separately

The deduction amount depends on income levels, but the maximum is $2,500 for each person claimed as an exemption.

Child Day Care Credit

New Mexico parents who have AGIs of $30,160 or less may claim this credit (not to exceed $1,200) for child care expenses for dependent children when the child care enables the parent’s gainful employment.

Help with Filing Tax Returns

Among the reasons low-income families may not file tax returns are that they don’t know how and can’t afford to pay a professional to do it. Free assistance with filing federal and state tax returns is available for low- to moderate-income families and to the elderly through several programs:

CNM runs Tax Help New Mexico, which has sites across the state (http://www.cnm.edu/depts/taxhelp).

The IRS runs the Volunteer Income Tax Assistance (VITA) program in sites across the state (http://www.irs.gov/Individuals/EITC-Home-Page–It%E2%80%99s-easier-than-ever-to-find-out-if-you-qualify-for-EITC).

The state’s Taxation and Revenue website also offers several resources on how to claim these benefits (http://www.tax.newmexico.gov).

Kwaku Sraha is NM Voices for Children’s Business Manager

It sounds like something out of a political thriller movie: hastily cobbled together legislation is railroaded through with a vote in the closing minutes of a session. The truncated debate that takes place is woefully uninformed because no one has had time to read the bill. Nor is there time for public input. This scenario did not play out in Hollywood, but in Santa Fe when legislators were given 35 pages worth of amendments to House bill 641 and told to vote on it before the clock struck 12. What they were not given was any meaningful information about the fiscal impact of what they were voting on. In fact, they were misled.

Tom Clifford, the Secretary of the Department of Finance and Administration, and one of the architects of this package of huge corporate tax breaks, was given the microphone on the floor of the House in the closing minutes of the session so he could reassure legislators that the bill would be “revenue positive” every year. He actually made that statement twice—and both times it was wrong.

A few days later—when the Legislative Finance Committee released its fiscal impact report (FIR)—it became clear that HB-641 will NOT be revenue positive but will, in fact, cost the state tens of millions of dollars within the first three to four years.

Legislators should not be expected to vote on an omnibus tax bill before the proper fiscal analysis has been completed. Such bills are too complex and the consequences too important. Nor should they be pushed into passing legislation under the threat of a budget veto by the governor.

The two main (and most expensive) portions of the bill give breaks to manufacturing companies and profitable corporations. We are told that these two provisions will make New Mexico more “competitive” with other states when it comes to luring business here. This is a deviation of the worn-out notion that tax cuts at the top will trickle down to jobs at the bottom (or, perhaps, somewhere in the middle). But, after 40-some years of this economic experiment, we’ve pretty much learned that it simply doesn’t deliver on its promises.

There is, in fact, absolutely no evidence that corporate income tax cuts create jobs. There is, however, abundant evidence that tax cuts starve our state budgets of funding for vital services like education, public safety, and health care. The upshot is, New Mexicans will either have to live with fewer services or will have to pay higher taxes to make up for the lost revenue.

These cuts are being paid for, in part, by the state reneging on a promise it made to cities and counties regarding revenue the state no longer wants to pass along. To help the municipalities recoup this loss, the legislation kindly allows them to raise taxes on the rest of us. Which they probably will.

In other words, profitable corporations are getting tax cuts on the backs of New Mexico’s children and working families.

To add insult to injury, the Governor—who is not likely to veto this bill—has promised to veto a bill that raises the minimum wage. Her reasoning there is just as flawed as trickle-down economics. She claims raising the minimum wage will make New Mexico less competitive with other states for new jobs. That’s only true if you’re hoping to lure low-wage jobs to the state (and, really, we have enough of those already). If you’re trying to create decent jobs by reviving the economy, putting money into the hands of the people most likely to spend it is a really good idea.

Governor Richardson promised that his personal income tax cuts of 2003 would create jobs because companies would relocate their corporate headquarters here so their highly paid staff could benefit from the low top tax rate. A decade later, we’re still waiting for those jobs to appear. We suspect that, once it becomes clear that this year’s tax cuts are also not creating jobs, some legislators may regret their 11th-hour vote.

To paraphrase an old saying: Pass a bill in haste; regret in leisure.

Gerry Bradley is NM Voices for Children’s Senior Researcher and Policy Analyst

FOR IMMEDIATE RELEASE

ALBUQUERQUE—New Mexico’s lowest-earning families pay state and local taxes at a rate more than double that of the highest-earning households. That’s according to the report, “Who Pays? A Distributional Analysis of Tax Systems in All 50 States,” released today by the Institute on Taxation and Economic Policy (ITEP).

As the table for New Mexico (attached) shows, the state’s households in the bottom fifth earning bracket pay 10.6 percent of their income on state and local taxes. Those in the top 1 percent pay just 4.8 percent of their income in those same taxes.

“New Mexico’s tax structure has become more regressive over the years, particularly since the income tax rate for the top bracket was cut in half in 2003,” said Gerry Bradley, Research Director for New Mexico Voices for Children. “Sales taxes have always fallen hardest on those with the lowest incomes because they must spend virtually all of their income on day-to-day necessities, where as those in the higher income brackets are able to set some aside in savings.”

In fact, sales and excise taxes show the largest rate gap—with the lowest 20 percent of households paying about seven times what the highest 1 percent pays. New Mexico has a gross receipts tax (GRT) rather than a traditional sales tax, but the amount is usually passed along to the customer, much like a sales tax.

“New Mexico used to have a fairly low, broadly based gross receipts tax and, coupled with a more progressive income tax structure, that made the overall system much more fair,” Bradley said. “But over the years we’ve enacted numerous exemptions, which meant raising the GRT rate to make up the difference.”

Two other recently released reports also paint a dismal picture of life for New Mexico’s low-wage workers: New Mexico has the highest income inequality in the nation, and the highest rate of working families who are low income.

“Given these reports, coupled with our anemic job growth, things aren’t likely to turn around for low-income families soon unless our lawmakers step up,” Bradley said. “The Legislature is considering a couple of bills that would help—raising the minimum wage and indexing it to inflation, and increasing the Working Families Tax Credit. Conversely, legislation to lower the corporate income tax rate or give a break to manufacturing companies and oil and gas producers will only make matters worse for working New Mexicans. Such proposals will not generate enough new jobs to make up for the lost revenue, so services like education, public safety, and health care will suffer,” he added.

The report can be downloaded here: http://www.itep.org/whopays/

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New Mexico Voices for Children is a nonpartisan, nonprofit organization advocating for policies to improve the health and well-being of New Mexico’s children, families and communities. Our fiscal policy work is funded by grants from the Annie E. Casey Foundation, the McCune Charitable Foundation, the WK Kellogg Foundation, and the Working Poor Families Project.

625 Sliver Ave. SW, Suite 195, Albuquerque, NM 87102; 505-244-9505 (p); www.nmvoices.org

Download this press release here (pdf)

Download the New Mexico fact sheet here (pdf)